American Institute of Certified Planners (AICP) Practice Exam

The primary purpose of the shift-share technique is to analyze job and population movement within a community. This analytical tool allows planners and analysts to understand how local economic growth or decline is influenced by broader economic trends and local factors. By breaking down changes in employment into components that reflect national, industry-specific, and local influences, shift-share analysis helps identify whether changes in job numbers are due to overall economic conditions, shifts in industry composition, or local competitive advantages.

This method provides valuable insight for community planning by highlighting which sectors are gaining or losing jobs relative to larger trends, thereby informing strategic decisions regarding economic development, workforce training, and resource allocation. Understanding these dynamics is crucial for planners aiming to foster sustainable community growth and to respond effectively to demographic changes.